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TMI Blog2011 (4) TMI 503X X X X Extracts X X X X X X X X Extracts X X X X ..... 1) read with sections 2(14), 2(11)(9b), 48 and section 55(2)(ii) of the Act - The combined reading of the above provisions and of section 28(va) leaves no ambiguity that law makers specifically excluded the income from the purview of main section 28(va) - Hence, appeal is dismissed accordingly. X X X X Extracts X X X X X X X X Extracts X X X X ..... observed that this income should be made taxable under the head 'Business and Professions' vis-a-vis 'Capital Gain' as taken by the assessee. Thereafter, Assessing Officer had taxed the same under section 28(va) of the Income-tax Act, 1961 treating the same as business income and recomputed the taxable income of the assessee company. 3. We may record that before taking the aforesaid view the Assessing Officer asked the assessee company as to why sale shown as long term capital gain be not treated as business income for the year in question in the reply submitted by it, the assessee explained that it was publishing the journals since 1995 onwards, but in all the journals published, the period of starting the journals was more than three years from the date of transfer of these assets. Further, all the journals were initiated by the company itself and were not in existence earlier. These journals are registered with the Registrar of Newspapers of India (RNI), before registration, the brand name/titles of journals are approved by the RNI. Thus, the assessee was the owner of brand name of these journals which were also registered/indexed with Indian National Scientific Documentation ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... come but long term capital gain on transfer of the assets. This decision of the CIT(A) has been upheld by the ITAT also dismissing the appeal of the revenue vide impugned order dated 19-12-2009. The ITAT downrightly observed that assessee seems to be the elite owner of the Trademark & Copyright of these publications. Also publications i.e., journals were undeniably capital assets of the assessee's business duly registered with the Trademark Authorities. It was also established by the ITAT that assessee has sold all its intangible assets like trademarks, brands, copyrights & goodwill. By doing this exercise, the assessee company has deprived itself of any earnings in the subsequent years. It was also revealed by ITAT the assessee company has wholly given up its right to carry on Healthcare Journals and Communications business for a specified period. The ITAT was of the clear view that there is no connection between the two businesses i.e., Business of Healthcare Journals & Communications was clearly a distinct and separate business as before sale of intangible like trademarks, brands, copyrights and goodwill. The ITAT further concluded that assessee has lost the source of income and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... - (a) In any area which is comprised within the jurisdiction of a municipality (whether known as a municipality, municipal corporation, notified area committee, town area committee, town committee, or by any other name) or a cantonment board and which has a population of not less than ten thousand according to the last preceding census of which the relevant figures have been published before the 1st day of the previous year; or (b) In any area within such distance, not being more than eight kilometres from the local limits of any municipality or cantonment board referred to in item (a), as the Central Government may, having regard to the extent of, and scope for, urbanisation of that area and other relevant considerations, specify 20 in this behalf by notification in the Official Gazette; (iv) 6 1/2 per cent Gold Bonds, 1977, issued by the Central Government; (v) Special Bearer Bonds, 1991, issued by the Central Government; (vi) Gold Deposit Bonds issued under the Gold "Deposit Scheme, 1999 notified by the Central Government." Section 2(11): "block of assets" means a group of assets falling within a class of assets comprising- (b) Intangible assets, being know-how, pat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (d) That the consideration for the transfer of intangible assets being trademarks, brands, copyrights and the associated goodwill of Healthcare journals & communications business was taxable as long term capital gain. (e) That for the purposes of journals etc., published by the appellant company it had to go through the following procedures which proves the authenticity of the appellant's claim of the assets being in the nature of intangible capital assets of business :-- (i) Statutory Title Clearance for all publications was obtained prior to the commencement of publication from the office of the Registrar of Newspapers for India. (ii) All these publications were registered with the RNI. (iii) The appellant had also filed "form-B" declaration before the DCP (Licensing), Delhi. (iv) All publications were indexed by INSDOC. (v) Publications have been published as property of the appellant company in Trade Mark Journal No. 1328 Suppl. 4 (vi) All publications have a copyright declaration. 11. The CIT(A) as well as ITAT have rightly held that in this backdrop provisions of section 28(va) would not apply to the instant case. In this behalf, it is to be borne in mind that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he periodical and products as carried on by the seller (assessee). It also termed all these publications as "Business Intellectual Property Rights" which were treated as "Specified assets". As per clause (2) of the agreement, all these specified assets were transferred in the following manner :-- "2. Transfer of specified assets 2.1 The Seller shall sell or procure the sale with full right, title, interest and guarantee and CMP Medica shall purchase the following assets and with a view to CMP Medica carrying on the business pertaining to the Specified Assets as going concern from the seller with effect from the closing date: (a) the Periodicals; (b) the Products; (c) the Business Intellectual Property Rights alongwith the Goodwill and all interests and benefits attached and appurtenant to the Business Intellectual Property Rights; (d) the Customer Database; (e) The Records; (f) the Editorial Materials; and (g) the Contracts. 2.2 The Seller as the beneficial owner, agrees to assign, transfer and convey to CMP Medica all is rights, title, and interests to the Specified Assets including other intangible benefits and, or, rights related to the Specified Assets to the e ..... X X X X Extracts X X X X X X X X Extracts X X X X
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